Canadian financial services firm: Bitcoin is becoming more decentralized
|- Canadian financial services firm Canaccord Genuity Group stated that Bitcoin has become more decentralized in recent times.
- The main reason behind this increased decentralization is the “commoditization of bitcoin mining chips” since advances in ASIC technology has stalled.
Canadian financial services firm Canaccord Genuity Group stated in a February report that Bitcoin has become more decentralized in recent times. The report indicated that in its early days, Bitcoin was extremely centralized.
In mid-2014, mining pool GHash.IO controlled 50% of Bitcoin’s hashrate making it susceptible to a potential 51% attack. In stake contrast, nobody owns more than 20% of Bitcoin hashrate in 2019. There are five mining pools right now that own 10-20% of the network hashrate while the rest control less than 10%.
The main reason behind this increased decentralization is the “commoditization of bitcoin mining chips.” Since advances in ASIC technology has gone down, the competition among rival mining pools has become more intense.
The report cites the example of Canaan Creative and Bitmain. Since Canaan can’t create a superior alternative to Antminer S9, they are focussing on selling their mining devices to an audience far more extensive than Bitmain’s. This helps Canaan to keep competing with Bitmain.
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